French house-building plummets

French house building plummeted by 19.8 percent in the three months from March to May from the level for same period last year, official data released on Tuesday showed.

The data indicates that an important part of the economy is flagging.

On a sliding three-month basis the result nonetheless represented an improvement from the February-April period, when housing starts fell by 22.5 percent, the housing ministry data showed.

A total of 72,020 units were granted permits this time around.

Over the past 12 months, from June 2011 through May, French housing starts have remained slightly positive, with a gain of 1.2 percent on an annualised basis.

On Friday, the national statistics institute INSEE said that the purchasing power of French households dipped last year, and that consumption had fallen as well, contributing little to economic growth.

INSEE has estimated that the French economy grew by 1.7 percent last year, while the European Commission and new French President Francois Hollande have both forecast growth this year of 0.5 percent.

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